Addressing the merits of an injunction in a case where the
district court and the Patent Trial and Appeal Board (PTAB)
disagreed as to the validity of a patent in parallel proceedings,
the US Court of Appeals for the Federal Circuit affirmed the
preliminary injunction by citing to the different standards applied
by each forum. Tinnus Enterprises, LLC, Zuru LTD v. Telebrands
Corporation, Bed Bath & Beyond, Inc., Case No. 16-1410
(Fed. Cir., Jan. 24, 2017) (Stoll, J).

Tinnus produces the “Bunch O Balloons” toy for
filling water balloons and owns a patent covering the toy.
Telebrands sells a competing “Balloon Bonanza” product.
Both products attach to a hose in order to simultaneously fill
multiple water balloons. Tinnus sued Telebrands and Bed Bath &
Beyond (collectively, Telebrands) for patent infringement and moved
for a preliminary injunction. The magistrate judge issued a report
and recommendation (R&R) recommending the injunction, which the
district court entered. Telebrands appealed. At about the same
time, the PTAB instituted a post-grant review (PGR) requested by
Telebrands. Telebrands did not move for a stay pending the PTAB
decision, so the litigation and the PGR proceeded concurrently. In
a final written decision, the PTAB found all of the claims invalid
as indefinite.

Telebrands appealed the district court’s conclusions with
respect to the likelihood of success on the merits and irreparable
harm. Because Telebrands failed to object to the R&R’s
indefiniteness determination, that determination was reviewed under
a plain error standard, rather than the abuse of discretion usually
applied on appeal. The Federal Circuit found no plain error in the
district court’s indefiniteness analysis, despite the
contrary finding by the PTAB. In this case, the difference in
result can be attributed to the different standards used to
evaluate indefiniteness in district court and the PTAB. In a PGR
proceeding, indefiniteness is evaluated under the Packard
test, while in district court, indefiniteness is evaluated under
the Supreme Court of the United States’ Nautilus
standard. The difference is that the Packard test sets a
threshold for indefiniteness when a claim contains words or phrases
whose meaning is unclear and demands at least as much clarity, and
potentially more, than Nautilus’s reasonable
certainty requirement.

Telebrands also faulted the district court for its purported
failure to construe several terms. However, the Federal Circuit
noted that the R&R adopted by the district court acknowledged
the parties’ disagreement with respect to construction of
certain claim terms, but concluded that Tinnus was likely to
succeed regardless of those terms’ interpretation. Telebrands
also argued that each claim limitation must be found in the accused
product itself and that reliance on an instruction manual to show
one of the claimed features was clear error. The Federal Circuit
again disagreed, explaining that a patentee is entitled to rely on
circumstantial evidence such as instruction manuals to establish
infringement.

Telebrands next argued that it was clear error for the
magistrate judge to rely on evidence pre-dating patent issuance in
support of its irreparable harm finding. The Federal Circuit
disagreed, finding that the pre-issuance evidence demonstrated the
possibility of identical harm post-issuance. Moreover, the Court
found that the record also contained sufficient post-issuance
evidence to support the district court’s finding of
irreparable harm.

Practice Note: Depending on the applicable
circuit law, and at least in the Fifth Circuit, practitioners
should adequately object to a magistrate judge’s report and
recommendation in order to avoid the more deferential plain error
standard of review on appeal.

The Intellectual Property (Unjustified Threats) Act 2017 (the "Act") entered into force on 1 October 2017, introducing changes to the law in the UK regarding threats of intellectual property proceedings.

The UK government has published its draft EU Withdrawal Bill. Although frequently dubbed the "Great Repeal Bill" it does not in fact seek to repeal all the European law that currently has force in the UK.

This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).

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